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Department of Energy Announces Loan of Oil from the Strategic Petroleum Reserve

September 1, 2005 - 9:03am

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WASHINGTON, D.C. – Secretary of Energy Samuel W. Bodman announced today that the Department of Energy has approved a request for a loan of 6 million barrels of crude oil from the Strategic Petroleum Reserve (SPR).

"We are committed to doing everything in our power to meet the immediate needs of those directly affected by Hurricane Katrina. By utilizing the resources from the Strategic Petroleum Reserve, we will help minimize any potential supply disruptions as a result of the hurricane. With the Reserve fully operational, we will be able to start delivering this oil as soon as tomorrow," Secretary Bodman said. "In addition, we are continuing to review loan requests as they come in. When a loan becomes finalized, we will announce it."

Today’s agreement between the Department of Energy and ExxonMobil Corp. is for a loan of 3 million barrels of "sweet" crude and 3 million barrels of "sour" crude oil, and is larger than the 5.4 million barrels loaned during Hurricane Ivan. The crude oil will be loaned from the SPR under short-term contractual agreements and returned to the Reserve once supply conditions return to normal.

In considering this and any future use of the SPR, the Department of Energy is in consultation with major oil producing nations and the International Energy Agency, which represents major consuming countries.

Oil has been released from the Strategic Petroleum Reserve seven times under exchange arrangements. Most recently, the Department entered into similar loan agreements following Hurricane Lili in October, 2002 and Hurricane Ivan in September, 2004.